Can I place the remaining mortgage payment on my existing home towards a mortgage on a new home?
March 9th, 2010 | 
Author: Amidst thіѕ struggling economy, I’m looking tο sell mу townhouse аnd bυу a single-family home. I know I wіll nοt sell thе house fοr more thаn I originally bουght іt fοr, bυt wіll I bе аblе tο transfer thе remaining balance οf thе finance аftеr I sell thе townhouse tο thе finance οn thе nеw single-family home? Excuse mу limited knowledge οn thе rules аnd regs regarding mortgages. Thank уου!
Posted in Mortgage FAQ
No. Your current Finance must be paid in full so that ownership passes to the buyer and his lender.
You then have to apply for an entirely new finance for the new home.
No, you can’t transfer anything. When you sell the townhouse, you have to pay off the finance on the townhouse. You should talk to your realtor and/or finance rep about this.
Excellent luck.
The only way you can use money from the sale of your current home is to sell it above and beyond what the payoff is including Real Estate commission and all closing cost. If in fact you clear more than your payoff and all closing cost you can use those duty for a down payment on the new home. FHA home loans only require a 3.5% down payment and the seller can pay up to 6% of your closing cost.
Hope this helps
Your loan is sold as a security bond…secured by that specific residence. The owner of that bond is not the bank, it’s some guy in china who wants all the money that his bond is worth. You will really not be able to sell (transfer title) to new ownership till the before finance holder is paid in full, so transferring the remaining finance balance to a new subject property is only shifting the debt…you still owe that bank the remaining balance.
It also wont work because your new buy loan (best case scenario 97% LTV),of lets say 194K is secured by a home worth 200K…if you were to transfer a balance of even 10K that would bring the loan amount greater than the property securing it. Even if you only transferred a measly 2K to the new loan…a loan amount of 196K violates the guidelines restricting loan amounts to exceed our 97% FHA loan.
Use the down paymenmt you were gonna use, and pay off the remaining balance if possible then get a high LTV buy loan via FHA to buy the new home.